Tuesday, October 28, 2025

SEWER LINE BLUES

There's no such thing as a "perfect" sewer line.

For years in our robust and appreciating housing market, unless sewage was actively backing up into the basement, sellers had the ability to push back and shut down requests for sewer line repairs.

But with a softer market comes new realities, including more complex and difficult inspection negotiations.  Buyers today simply won't tolerate deficiencies they may have been willing to accept when competing with multiple offers during the "glory years".

Nowhere is this more evident than with sewer line inspections.  Nearly half of the deals I have closed this year have required negotiations and/or repairs related to sewer line concerns.

Why has this happened?  And how long will this continue to be an issue in the Denver housing market?

First, let's start with some history.

Up until the late 1980s, most sewer lines in the Denver metro area were traditionally 3 to 5 foot segments of clay pipe sleeved together with rubber joints.  This allowed for some ground movement (without shattering the pipe), but over time these lines can shift, roots can get into the line and eventually many of them fail.

Since the late 1980s, most sewer line installations have been continuous runs of plastic pipe.  This more sturdy plastic material can benf and adapt to some soil shifting, although "'bellies" can still form in the line and become an issue.

But as a generalization, you're going to find substantial imperfections in at least 50% of the old clay pipes and probably 20% of the newer plastic lines.

One major distinction here is that sewer line evaluations can be very subjective.  What "company A" says is a defect needing repair or replacement may be considered entirely functional by "company B".  And who scopes your line is also a really big deal.  Under most circumstances it is risky (at best) to hire companies to scope sewer lines that also do repairs, because the conflict of interest here is obvious. 

When it comes to repairs, now you have another variable.  There are certain predatory "big box" plumbing companies that will be happy to charge 3 - 5 times what smaller, more nimble repair companies will charge for the same repair.

Some companies will automatically default to replacing the entire line, which involves digging up the sidewalk and burrowing down 8 - 12 feet into the street.  We're talking $15k - $25k most of the time for this type of repair.

If a repair will do the trick and the crack or break is located in the yard (and not under the sidewalk or street)... you might be looking at $4k - $6k (or $15k if you hire a big box plumber).

I have looked at 1000+ sewer scopes through the years and I usually have a pretty good idea what's a legitimate concern and what is scaremongering.  I also know which companies you DO NOT want anywhere near your sewer line (unless you're comfortable signing over your house to them).

How long will sewer line issues be a major point of contention in home inspections?  For over a decade, our housing market was among the most robust in the nation and sellers simply said "no" to most repair requests.  As a result, not only do you have a higher number of older lines failing due to age, but you have a decade or more of "catching up" to do on repairs that should have been made (but were not) when homes sold between 2010 - 2022.

Add it all up, and it's just another challenge for sellers already trying to navigate a difficult market.  For buyers, it's okay to dig your heels in when circumstances call for it.  And whether you're buying or selling, it's critical to make sure you have an honest, reputable vendor running that camera through the line.

The "sewer line blues" will continue to be a thing until our market heats up again.  Reality is, almost every sewer line has some imperfections to it.  Lines with minor defects or hairline cracks can often continue worked well for decades, as long as they are maintained and monitored.  But sometimes the issues are more serious.

In our current market, buyers have tremendous leverage.  And that means a lot of yards (and streets) are being dug up these days for sewer line repairs.  

Thursday, October 2, 2025

CURRENT INDUSTRY LAWSUITS: ZILLOW VS EVERYBODY (OR IS IT EVERYBODY VS ZILLOW?)

As the real estate world continues to adjust to harsh market conditions and frustrating new compensation rules, Zillow is under the microscope like never before. 

Here's a look at current industry lawsuits involving Zillow:

COMPASS VS ZILLOW:
  Compass and Zillow are currently involved in multiple countersuits over each other's practices.  Zillow is suing Compass for access to its "Private Exclusive" platform, which promotes some Compass listings exclusively through the Compass website.  Compass is suing Zillow for withholding certain Compass listings from its platform in retaliation for its Private Exclusives Network.

HOMEBUYERS (CLASS ACTION) VS ZILLOW:  A class-action lawsuit filed in September by the same attorneys who upended real estate compensation practices in 2023.  This case alleges that Zillow deceptively inflates homebuyer costs by charging referral fees of up to 40% for leads generated through its various platforms.  The case seeks class-action status for anyone who used a Zillow-referred agent to purchase a home in the past four years.

CO-STAR VS ZILLOW:  Co-Star is the parent company of Apartments.com and Homes.com, and in this suit Co-Star claims that Zillow has effectively stolen more than 47,000 listing photos from its websites without compensation or permission.

FEDERAL TRADE COMMISSION VS ZILLOW:  The FTC has filed suit against Zillow for "unfair trade practices" based on a recent $100M marketing agreement between Zillow and Redfin which gives Zillow exclusive access to Redfin's network of rental listings.  This is all part of a larger "private networks" debate as industry players look to build exclusive channels with exclusive access to certain listings and property types.

Why so much Zillow chaos?

Zillow generates more than $2 billion in revenue each year by monetizing listing data it does not own.  Both nationally and locally, transaction counts are down dramatically as buyers are priced out by high rates and sellers simply stay in homes that no longer meet their needs because of 3% mortgages.

Housing has become an incredibly inefficient market thanks to the Fed's boneheaded zero-interest rate policies of 2020-22.

The pie is no longer big enough to feed all the mouths, and so Zillow has become a top target in a multi-front war with brokerages, consumers and the FTC as it tries to remain relevant in a rapidly recalibrating world.